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MONTHLY REVIEW O f Agricultural, Industrial, Trade and Financial Conditions in the Eighth Federal Reserve District Released for Publication On and After the Morning of November 30, 1931 J O H N S. W O O D , Chairman and Federal Reserve Agent FEDERAL RESERVE RAD E and industry in the Eighth Federal Reserve District during October failed to better the low rate of activity prevailing during the preceding month. On the contrary, with virtually all lines investigated by this bank, there was a slowing down as contrasted with September, and as compared with the same time last year, the showing was distinctly unfavorable. In the large cities and the country purchasing of commodities was on a very conservative and cautious scale, and universally there was a disposition to conserve cash. Unseasonably high temperatures obtaining through the month tended to hold down distribution of fall and winter goods, besides causing many manu facturers to further postpone programs for increased production. This was true particularly in the heav ier lines, notably iron and steel, lumber, fire clay products and all descriptions of building materials. As has been the case for many months, manufactur ers were making up only limited quantities of goods for stock, confining their operations almost excluively to materials to apply on orders actually booked or in reasonably certain prospect. T The most important constructive development in this area, has been the sharp rise in prices of wheat, corn, cotton and other important agricultural products. This change has resulted in a sharp accel eration in business of wholesalers in the large dis tributing centers, also in retail trade in the country and small towns. A number of large retailing and jobbing firms which furnish their statistics to this bank, report sales volume during the first half of November the largest for any similar period this year. Agricultural prospects maintained the high promise of earlier in the year. Production of virtu ally all the leading crops grown in this district in 1931 will considerably exceed the average, and in the case of cotton and corn, new records for all time are indicated. Thus, while prices through the sea son have been low, large quantities to dispose of will partly offset the low unit return. In many sec C. M . STEW ART, Assistant Federal Reserve Agent BANK OF ST. J. V I O N P A P IN , Statistician LOUIS tions liquidation by farmers has been in excess of expectations, and additional reduction of indebted ness is in prospect. Throughout the district, farmers are well supplied with food and feed for carrying through the winter, and conditions in the agricultur al areas are considerably better than at the corre sponding period a year or two years ago. The volume of retail trade in October, as re flected in sales of department stores in leading cities, was 15.6 per cent smaller than during the same month in 1930, and approximately 3 per cent larger than in September this year; for the first ten months this year the total was 13 per cent smaller than dur ing the same period a year ago. Combined sales of all wholesaling and jobbing firms reporting to this bank were one-fourth smaller in October than for the same month in 1930 and 7 per cent smaller than the September total this year; for the first ten months this year the aggregate was 16 per cent be low that of the same period in 1930. The value of permits issued for new buildings in the five largest cities of the district in October was 15.5 per cent smaller than in September, and 11 per cent larger than in October, 1930. Construction contracts let in the Eighth District in October were the smallest for any month since these records have been kept; 36 per cent smaller than in September and 76 per cent less than in October, 1930. Debits to individual accounts in October exceeded the September total by 8.8 per cent, but were almost one-fourth less than in October, 1930; for the first ten months this year the aggregate was about one-fifth smaller than for the same period in 1930. Savings deposits held by selected banks decreased slightly between O cto ber 7 and November 4, and on the latter date were 6.4 per cent smaller than on the corresponding date last year. Freight traffic of railroads operating in this dis trict continued in considerably smaller volume than during the corresponding period a year and two years earlier. Recessions occurred in all classifica tions, but were most pronounced in merchandise and miscellaneous freight and coal and coke. Due to the unusually mild weather through October and the first half of November and the low rate of opera tions at industrial plants, consumption of fuel was much smaller than the usual seasonal volume. For the country as a whole, loadings of revenue freight for the first 44 weeks this year, or to October 31, totaled 32,379,444 cars against 39,905,050 cars for the corresponding period in 1930 and 45,671,671 cars in 1929. The St. Louis Terminal Railway, which handles interchanges for 28 connecting lines, inter changed 152,751 loads in October, against 144,833 loads in September and 194,613 loads in October, 1930. During the first nine days of November the interchange amounted to 43,328 loads, which com pares with 46,993 loads during the corresponding period in October and 54,121 loads during the first nine days of November, 1930. Passenger traffic of the reporting roads decreased 20 per cent in October as compared with the same month last year. Esti mated tonnage of the Federal Barge Line between St. Louis and New Orleans in October was 105,000 tons, against 106,931 tons in September and 102,569 tons in October, 1930. Reports relative to collections reflected some what spotty and irregular conditions, but with the average slightly better than during the preceding thirty days and comparing favorably with the cor responding period a year ago. Throughout the south, where cotton, rice and tobacco are being har vested, liquidation showed improvement as con trasted with the month before. Planters have taken up a considerable part of their indebtedness to the Government for feed and seed loans, thereby releas ing much cotton for paying other bills. The upturn in wheat prices has been reflected in a quickening in collections in the typical grain areas. W hole salers and jobbers in the chief distributing centers report October 1 settlements fully up to expecta tions, with some lines showing better results than a year ago. City retailers report little change in con ditions from earlier in the fall. Questionnaires ad dressed to representative interests in the several lines scattered through the district show the follow ing results: E xcellent G ood Fair P oor October, 1931....... 0% 21.1% 56.4% 22.5% September, 1931....... 0 13.8 64.1 22.1 October, 1930....... 1.4 8.5 67.6 22.5 Commercial failures in the Eighth Federal Re serve District in October, according to Dun’s, num bered 126 involving liabilities of $2,497,736 against 102 failures in September with liabilities of $2,621,575, and 118 defaults for a total of $3,505,807 in October, 1930. The average circulation in the United States in October was $5,478,000,000 against $5,133,000,000 in September, and $4,501,000,000 in October, 1930. MANUFACTURING AND WHOLESALING Boots and Shoes — October sales of the report ing firms were 28 per cent smaller than for the same month in 1930, and 9 per cent less than the Septem ber total this year. Inventories continue to decrease, stocks on hand November 1 being 23 per cent and 8 per cent smaller, respectively, than a month and a year earlier. The decrease in the month-to-month sales comparison is seasonal, and compares with a decrease of 15 per cent for the same period in 1930. Weather conditions have been unfavorable for the movement of seasonal goods, and another influence tending to hold down sales was the disposition on the part of retailers to await possible price reduc tions. Collections were reported in the main good, though the volume of actual losses from weak ac counts is considerably larger than heretofore. Fac tory operations were reduced somewhat, averaging from 60 to 65 per cent of capacity. Clothing — According to the reporting firms, the movement of seasonal apparel during October continued much below normal, due chiefly to the mild weather prevailing in October and during the first part of November. Sales in October showed a considerable increase over September, but the total was 17 per cent smaller than for October last year. Demand in both men’s and women’s lines centers largely in cheap-priced goods. Drugs and Chemicals — October sales of the re porting interests fell 21 per cent below the same month in 1930, but increased 1 per cent over the September total this year. Stocks on November 1 were slightly larger than thirty days earlier, but 6 per cent less than on November 1 last year. Buy ing of seasonal merchandise was backward, due partly to the warm weather. In the immediate past, considerable betterment has taken place in advance ordering of holiday goods and remedial drugs. This has been offset, however, by the usual recession in demand for heavy chemicals and drugs by the manu facturing trade. Prices were about steady with the preceding month, advances in certain commodities being balanced by declines in others. Dry Goods — Activities in this classification during October failed to develop improvement, sales of the reporting firms in that month showing a decline of 27 per cent under the corresponding period last year and of 1 per cent under the Septem ber volume this year. In the comparison with a year ago a considerable part of the decrease is ac counted for by lower prices. Unseasonably high temperatures held down purchasing of cold weather merchandise, notably underwear, outings and w ool en blankets. Since November 1 there has been con siderable pick-up in all lines, attributed partly to the upturn in certain agricultural products and to a greater disposition on the part of retailers to re plenish heavily depleted stocks. Tw o leading firms reported sales during the first two weeks in Novem ber the heaviest for any similar period this year. Purchasing, however, continues chiefly for imme diate shipment, little appreciation being noted in advance orders. Stocks continue to decrease, the total on November 1 being 13 per cent smaller than a month earlier, and about one-third smaller than on November 1, 1930. Electrical Supplies — A moderate improvement took place in sales of the reporting firms from Sep tember to October, but the total for the latter month was one-third less than for the same period in 1930. Inventories also gained slightly between October 1 and November 1, but were 15 per cent smaller on the latter date than a year ago. In the sales comparison with last year, decreases were gen eral in practically all lines, but most pronounced in radio materials, household appliances and automo tive goods. Ordering of seasonal and holiday mer chandise is in smaller than the usual volume. Flour — Production at the twelve leading mills of the district in October totaled 305,335 barrels, against 300,676 barrels in September and 426,184 barrels in October, 1930. Considerable improvement in demand for all grades of flour developed during the last half of October, due mainly to the advance in the wheat market. The betterment has continued into November, though in the immediate past the erratic action of the grain market has had a tenden cy to hold down buying. For the first time in a number of months interest in future requirements was in evidence, and generally the class of buying was better than at any time this season. One fav orable development, according to reporting millers, was the broader demand for high grade flours. In sympathy with the upturn in wheat, prices advanced to the highest point since last July. Mill operations were at from 50 to 55 per cent of capacity. Furniture— October sales of the reporting firms were 44 per cent less than for same month in 1930 and 18 per cent smaller than the September total this year. Ordering by retailers through October continued on a hand-to-mouth basis, with relatively little interest being taken in holiday goods. Since November 1 there has been a fair pick-up in the line as a whole, particularly in household furniture and furnishings. There were no notable changes in prices as compared with the preceding thirty days, but the trend is lower. Inventories continue to shrink, stocks on November 1 being only about half as large as on the same date in 1930, and 15 per cent less than on October 1 this year. Groceries — Considerably smaller buying in the rural areas and generally lower prices were largely responsible for a decrease in October sales of the reporting firms of 21 per cent below the same month in 1930. A decrease of 8 per cent under the Septem ber total this year was shown. Stocks on November 1 were 14 per cent and 18 per cent smaller, respec tively, than thirty days and a year earlier. Advance ordering of holiday goods is reported in smaller vol ume than at any similar period in recent years. Hardware — Business in this classification was marked by further contraction during October, sales of the reporting firms for that month being 18 per cent smaller than for the same period in 1930, and 9 per cent less than in September this year. Inven tories also declined, the November 1 totals showing a decrease of 7 per cent and 22 per cent, respectively, as contrasted with thirty days and a year earlier. In the yearly sales comparison a considerable part of the decrease was due to reduced purchasing of builders’ tools and hardware, and of goods used chiefly in the rural areas. The trend of prices was slightly lower, with the average about 5 to 8 per cent below a year ago. Iron and Steel Products — Activities at mills, foundries, machine shops and other ferrous metal working plants in this district averaged slightly lower during October than the low rate in Septem ber. During the first half of November a further slowing down was noted, largely seasonal in char acter and most pronounced in the steel mills. De spite the small volume of shipments of finished goods, a further contraction in unfilled orders took place. The placement of new business continues along extremely cautious and conservative lines, and covers only materials for immediate requirements. Demand from the automotive industry was below expectations, new orders being in relatively small volume and specifications on materials under con tract, backward. This was true particularly in the case of malleable foundries and certain manufactur ers of forgings. The mild weather prevailing all fall had a tendency to hold down purchasing of seasonal goods, besides causing postponement of planned operations by certain specialty makers. Sales of farm implement interests were reported the smallest for any similar period in recent years, and for the most part their plants were closed down or being operated on heavily reduced schedules. Ordering by the railroads continues at the low ebb of earlier months this year. Since completion of the harvests, moderate expansion in materials for the agricultural sections has taken place, but the movement of such goods is considerably below the seasonal average. Distribution of iron and steel goods by jobbing and warehouse interests continued spotty and irregular, the only lines exhibiting activity being for use in highway construction and other outdoor engineer ing projects. Building materials generally remained quiet, and less than the usual seasonal improvement was noted in demand for tubular goods. Manufac turers and distributors of sheets and plates report October sales the smallest for any month since last winter. The trend of prices of finished materials generally was slightly easier, and further reductions were made in scrap iron and steel prices. Quotably pig iron was unchanged, but buying, particularly of basic iron, was hardly sufficient to fully test the market. Ordering for first quarter of 1932 has not developed, melters generally taking only what they need from month to month. For the country as a whole the average daily rate of pig iron production in October was 37,832 tons, a decrease of 2.8 per cent from the September rate. Total production in Octo ber was 1,172,871 tons, against 1,168,436 tons in September and 2,165,374 tons in October, 1930. Steel ingot production in the United States in Octo ber totaled 1,592,376 tons, against 1,547,602 tons in September and 2,692,539 tons in October, 1930. AUTOMOBILES Combined passenger car, truck and taxicab pro duction in the United States in October totaled 80,142, against 140,566 in September, and 150,044 in October 1930. According to dealers reporting to this bank, there was a substantial decrease in distribution of automobiles during October as contrasted with Sep tember, also a small decrease as compared with October last year. The decrease in the month-tomonth comparison is seasonal in character, having invariably taken place during the past eight years. The extent of the decrease this year was somewhat larger than the average, which fact is partly attrib utable to a general disposition on the part of pros pective purchasers to await the appearance of new models and possible price reductions. The decrease under a year ago was considerably smaller than in recent months. As has been the case since last fall, sales of dealers, in the country and small towns made a relatively less favorable showing than those in the larger centers of population. Sales of repair parts and accessories continue relatively heavier than of automobiles proper, due to the fact that owners are reconditioning their cars in order to prolong their period of serviceability. Sales of new passenger cars by the reporting dealers in October were 14 per cent less than in September and 7 per cent smaller than the October total last year. In anticipation of new models, dealers were universally holding their purchases from factories to a minimum. Inventories receded further, stocks on hand on November 1 being 8 per cent smaller than a month earlier, and approximately one-fourth less than on November 1, 1930. Fair activity was reported in the used car market, with demand for the better class of machines, those selling at $500 or more, showing distinct improvement. Stocks of salable new cars on hand on November 1 showed little change from a month earlier, and were about one-fourth less than on November 1 last year. Sales of trucks showed a slight decline from September to October, but a gain of 3 per cent over October, 1930. Deferred payment sales of dealers reporting on that item constituted 51 per cent of their total October sales, against 47 per cent in September, and 54 per cent in October, 1930. BUILDING In point of dollar value, permits issued for new construction in the five largest cities of the district in October were 15.5 per cent smaller than in Sep tember, and larger by approximately 11 per cent than in October a year ago. According to statistics compiled by the F. W . Dodge Corporation, contracts let in the Eighth Federal Reserve District in Octo ber amounted to $7,538,340, the smallest monthly total ever recorded and comparing with $11,790,867 in September, and $31,705,045 in October, 1930. Production of portland cement for the country as a whole in October totaled 10,762,000 barrels against 12,092,000 barrels in September, and 14,410,000 bar rels in October, 1930. Building figures for October follow . N ew Construction Permits *C ost Perm its 1931 1930 1931 1930 1931 Evansville .. 185 299 $ 56 121 66 L ittle R o ck 13 32 2 52 63 Louisville . . 5 8 92317 315 45 M em phis .... 163 170 591 243 133 St. Louis.... 308 380 463 552 267 O ct. totals Sept. totals A ug. totals *In thousands 727 973 1,429 817 1,414 1,692 678 1,237 1,266 (000 om itted ). 1,283 2,959 2,080 574 642 616 Repairs, etc. *C ost 1930 1931 1930 80 $ 21 $ 42 76 11 25 48 26 59 173 104 123 327 117 213 704 677 559 279 249 400 462 420 687 CONSUMPTION OF ELECTRICITY Public utilities companies in the five largest cities of the district report consumption of electric current by selected industrial customers in October as being about 7 per cent smaller than in September and 17 per cent less than in October, 1930. Detailed figures follow : O ct. Sept. N o. of Custom 1931 1931 ers * K .W .H . * K .W .H . 1,991 2,040 Evansville .... 40 1,888 1,548 L ittle R ock.. 35 6,587 6,319 Louisville .... 85 1,617 2,237 19,572 17,334 T otals ........... 355 29,478 * In thousands (000 om itted). 31,655 O ct. 1931 com p, to Sept. 1931 + 2.5% ' — 18.0 — 4.1 + 3 8 .3 — 11.4 — 6.9 O ct. 1930 * K .W .H . 1,984 2,378 7,649 1,816 21,720 35,547 O ct. 1931 com p, to O ct. 1930 + 2.8 % — 34.9 — 17.4 + 2 3 .2 — 20.2 — 17.1 The following figures, compiled by the U. S. Department of the Interior, show kilowatt produc tion both for lighting and industrial purposes for the country as a w hole: September, A ugust, Septem ber, B y water pow er 1931.................2,220,468,000 1931.................2,458,463,000 1930.................2,274,895,000 B y fuels 5,335,443,000 5,164,812,000 5,516,807,000 Totals 7,555,911,000 7,623,275,000 7,791,702,000 RETAIL TRADE The condition of retail trade is reflected in the following comparative statements showing activi ties in the leading cities of the district: Department Stores N et sales com parison Stocks on hand O ct. 1931 10 months ending O ct. 31,1931 com p, to com p, to O ct. 31, 1931 to O ct. 1930 same period 1930 Oct. 31, 1930 — 22.2% — 17.9% Evansville ....... .— 18.0% L ittle R o ck .... — 14.5 — 15.4 — 16.3 — 15.6 — 19.0 Louisville ....... .— 24.2 M em phis ......... ,— 19.1 — 18.7 — 24.0 Q u in cy ........... — 29.2 — 20.6 — 19.1 St. L ou is........., — 12.4 — 10.7 — 10.6 Springfield, M o .— 20.0 — 22.8 — 11.1 — 12.9 8th D istrict..... .— 15.6 — 14.5 Stock turnover Jan. 1, to O ct. 31, 1931 1930 1.55 1.66 2.11 2.03 2.23 2.28 2.52 2.40 2.08 2.15 3:07 3.14 1.40 1.38 2.75 2.74 Retail Stores N et sales com parison Stocks on hand O ct. 1931 10 months ending O ct. 31,1931 com p, to O ct. 31, 1931 to com p, to O ct. 1930 same period 1930 O ct. 31, 1930 M en ’s Furnishings — 7.6% B oots and Shoes......— 17.2 Stock turnover Jan. 1, to O ct. 31, 1931 1930 — 8.6 % — 14.2% 2.66 2.52 — 19.3 — 13.3 2.38 2.51 AGRICULTURE Through October and the first half of Novem ber weather in the Eighth Federal Reserve District was mild and generally auspicious for harvesting of late crops and agricultural operations of all de scriptions. As a result the indicated heavy yields of earlier in the season were well sustained, and in the case of several important productions, prospects increased between October 1 and November 1. Freezes and killing frosts were delayed later than is ordinarily the case and it was possible for farmers to carry their live stock on pasture further into the season than usual. Harvesting conditions were ideal, particularly for cotton, tobacco and corn, and these products were secured with minimum losses in quantity and quality. Lack of rainfall in some sections was unfavorable for fall planted grains, but generally plowing and preparation of the soil ad vanced rapidly and seeding of winter wheat was completed, though farmers were unable in many in stances to get in full intended acreage, and the total area seeded to wheat will be smaller than a year ago. Taken as a whole the output of agricultural products in this district in 1931 is one of the largest on record, and considerably in excess of the average during the past ten years. A favorable development of the past thirty days has been the sharp advance in prices of wheat, corn, cotton and some other important farm products. After the long period of declining values, the up ward reaction had the effect of buoying sentiment in the farming community, besides substantially increasing farm incomes. Due to the extremely low prices earlier in the season, producers were disposed to hold as much as possible of their crops for more favorable marketing conditions. Those who were able to pursue this policy have benefitted by the recent rise in prices. Except in sections of the south where cotton picking was in progress, there contin ued a large surplus of farm labor in all parts of the district, the number of unemployed having increased considerably since completion of the cereal harvests. Corn — Based on the November 1 condition, the U. S. Department of Agriculture estimates the output of corn in the Eighth District at 399,923,000 bushels, a slight decrease under the October 1 fore cast, and comparing with 183,254,000 bushels har vested in 1930, and an 8-year (1923-1930) average of 342.534.000 bushels. The quality of the crop is high, with an unusually large percentage being of mer chantable grades. Dry weather in October matured late corn, and nowhere was there damage from frosts. Harvesting and husking has made good pro gress and considerable housing of the crop has been accomplished. Winter Wheat — Due to dry weather early in the season, seeding of wheat extended further into the fall than is ordinarily the case. In some sections planting was still being carried on during the first week of November. However, newly seeded fields are growing rapidly and are generally in good con dition. The movement to market has been heavy, having been stimulated since late October by the rise in prices. Production of wheat in 1931 in this district is estimated by the Department of Agri culture at 65,546,000 bushels, against 44,241,000 bushels in 1930, and an 8-year average of 49,921,000 bushels. Fruits and Vegetables — Latest reports tend to confirm unusually large yields of vegetables and fruits in this district in 1931. Harvesting has been practically completed, and in the case of apples, pea nuts, sweet potatoes, peaches and a number of other important productions, yields are in excess of the 10-year average. The year was marked by increased cultivation of truck crops and small fruits, farmers turning to these products in order to carry out pro grams of diversification and departure from single crops. The apple crop in states entirely or partly within the Eighth District is 42,063,000 bushels, of which 4,494,000 barrels grade as commercial crop, against the small output of 12,935,000 bushels, with 1.666.000 barrels commercial crop in 1930, and a 5year average of 21,349,000 bushels of which 2,263,000 barrels were commercial crop. The output of pears in these states is estimated at 2,510,000 bushels, against 1,008,000 bushels in 1930 and a 5-year aver age of 1,729,000 bushels; sweet potatoes 18,588,000 bushels, against 14,018,000 bushels last year and a 5-year average of 18,188,000 bushels; peanuts, 31.730.000 bushels, against 19,950,000 bushels in 1930 and a 5-year average of 30,466,000 bushels; grapes 46,510 tons, against 33,831 tons in 1930 and a 5-year average of 32,387 tons. Gardens in many localities were benefitted by the delayed frost date and mild weather, and have proved serviceable considerably later into the season than is ordinarily the case. Live Stock — Reports from virtually all sec tions of the district reflect favorable conditions among live stock. Mild weather, late pasturage and ample supplies of feed and fodder have contributed to putting herds in exceptionally fine shape for market and weathering through the winter. Prices, particularly of hogs, have been low, and there are numerous complaints of scant profits on feeding operations. Milk production has been well main tained, but a further decrease in egg production took place. Late hay crops are turning out well as a rule. The crop of turkeys is one of the best in recent years, though due to mild weather, shipments to market up to the middle of November were rela tively light. Receipts and shipments at St. Louis as reported by the National Stock Yards, were as follows: R eceipts Shipments O ct., Sept., O ct., O ct., Sept., 1931 1931 1930 1931 1931 87,449 89,091 Cattle and Calves......122,408 126,753 140,285 H ogs ........................... 238,246 205,040 304,663 189,186 157,783 H orses and M ules...... 2,741 2,349 2,167 2,867 2,888 Sheep ........................... 64,087 51,951 65,42119,708 12,688 O ct., 1930 92,541 250,431 2,360 34,397 Cotton — Due largely to absence of damaging frosts in October, ideal harvesting conditions and minimum losses from rain and wind, cotton pros pects underwent further improvement between October 1 and November 1. Based on conditions on the latter date, the Department of Agriculture estimates production in the Eighth District at 3.684.000 bales, an increase of 175,000 bales over the October 1 forecast, and comparing with 2,289,000 bales produced in 1930, and an 8-year average (1923-1930) of 2,644,000 bales. Early November weather continued fine, picking continued in many localities, and indications point to smaller field loss this season than in a number of years. The move ment was somewhat slow in getting under way, but once started has been in heavy volume. Ginnings have made good progress, and reports on the por tion of the crop ginned to date indicate that the average weight of bales this season is heavier than any previous year on record. Prices of raw cotton moved upward from the low point of the season, reached in the first week of October. In the St. Louis market the middling grade ranged from 5.85c to 6.60c per pound between October 16 and Novem ber 16, closing at 6.00c on the latter date, which compares with 5.85c on October 16, and 9.35c per pound on November 17, 1930. Stocks of cotton in Arkansas warehouses on November 13 totaled 614,817 bales, which compares with 319,836 bales on October 16 and 357,127 bales on November 14, 1930. Tobacco — Relatively little change occurred during October, the output in this district being esti mated by the Department of Agriculture, based on the November 1 condition, at 407,512,000 pounds, a decrease of about 2,000,000 pounds under the October 1 forecast, and comparing with 306,070,000 pounds produced in 1930, and an 8-year average of 295.534.000 pounds. For the country as a whole the crop is estimated at 1,647,975,000 pounds. This fore cast, while for a record crop, is only about 0.4 per cent larger than the production in 1930, but approxi mately 21.4 per cent above the average for the five years, 1925-1929. Weather has been generally fav orable for curing tobacco, both in the burley and dark leaf districts. Markets for sale of the year’s crop will open between December 7 and 15, and heavy initial deliveries are looked for. Efforts are being made in the burley and dark tobacco districts to organize farmers into a cooperative marketing plan for sale of the 1931 crop. Rice — With harvesting about completed, it is evident that the rice crop in Arkansas will amount to about 9,010,000 bushels. This compares with 7.912.000 bushels produced in 1930 and a 5-year average of 8,310,000 bushels. Quality is mainly high, but prices disappointing, farmers receiving from 30 to 35 per cent less than at the same time last year. Commodity Prices — Range of prices in the St. Louis market between October 16, 1931 and Novem ber 16, 1931, with closing quotations on the latter date and on November 17, 1930, follow : H igh ...per bu..$ .65 H .7 OH M ay ................. .... “ N o. 2 red winter “ .67y2 “ .66 N o. 2 hard “ Corn (« .47** “ .52*6 “ N o. 2 mixed.... .46*4 N o. 2 white.... .47*4 Oats “ N o. 2 white.... .28*4 Flour Soft patent..... ...per bbl. 4.35 “ 4.60 Spring patent.. M iddling cotton.. ..per lb. .066 5.60 H ogs on h oof...... W heat L ow N ov. $ .48*4 .52*4 $ .60 .50 .59 .47*4 .34J4 .38*4 .38 .39*4 Close 16, 1931 N ov. $ .5 7% .61 @ .61*4 $ .84 .75 @ .59*4 .43*4 .47*4 .43 @ .43 y2 .43*4 @ .43*4 .2 3*A .28 3.25 3.75 .0585 3.75 3.80 4.25 4.00 @ .28*4 @ 3.85 @ 4 .50 .06 @ 4.15 .71 .75 17, 1930 $ .73*4 .75*4 @ .85 @ .76 .71*4 .76*6 @ .72 @ .76 .34*4 @ .35 4.30 4.40 7.25 @ 4.75 @ 4.65 .0935 @ 8.75 FINANCIAL The banking and financial situation in this dis trict during the past thirty days was marked by a noticeable increase in demand for credits, com ing from a wider diversity of borrowers than has been the case in a number of months. Requirements of mercantile interests in the chief distributing cen ters were on a somewhat larger scale, due in the main to seasonal influences. There was little change in demand from manufacturing interests, however, which continued at the low levels which have ob tained through the year. In the south there was the usual expansion in demand for funds for financing cotton, tobacco, rice and other fall crops. The sharp upturn in wheat prices was reflected in increased commitments by grain handlers, flour mills and kindred interests. Due to a disposition of cotton planters to hold their stocks for higher prices, liquidation of loans based on that staple has been backward, and country banks in the cotton areas have been slow in liquidating with their city corre spondents. Taken as a whole, however, liquidation has been in considerable volume, comparing favor ably with the corresponding period a year ago. Between October 14 and November 10 total loans and discounts of the reporting member banks decreased slightly, and the total of $396,537,000 on the latter date was approximately 18 per cent small er than at the corresponding time last year. Loans on securities were sharply lower in both the monthto-month and yearly comparisons. Deposits of these banks continued to recede during October, but the curve representing this item has turned definitely upward since the first of November. Investments showed only minor variation during the month, but on November 10 were almost one-third larger than a year ago. Due in large measure to the sustained heavy demand for currency, borrowings of all mem ber banks from the Federal reserve bank and the volume of Federal reserve notes in circulation ex panded further, reaching new high levels for the year. Interest rates moved upward during late Octo ber and early in November: At the St. Louis banks current rates were as follow s: Prime commercial paper, 4 to 5*4 per cent; collateral loans, 4y2 to 6 per cent; loans secured by warehouse receipts, 4y2 to 6 per cent; interbank loans, 5 to 6 per cent and cattle loans, 6 per cent. Condition of Banks — Loans and discounts of the reporting member banks on November 10, 1931, showed a decrease of 2.2 per cent as contrasted with October 14, 1931. Deposits decreased 2.6 per cent between October 14, 1931 and November 10, 1931 and on the latter date were 7 per cent smaller than on November 12, 1930. Composite statement fol lows : *N ov. 10, 1931 25 N um ber of banks reporting............ Loans and discounts (incl. rediscounts) Secured by U . S. Govt, obligations and other stocks and bonds....$ 155,041 A ll other loans and discounts.... 241,496 *O ct. 14, 1931 25 *N ov. 12, 1930 22 $158,550 240,461 $208,131 276,701 Total loans and discounts.............. $396,537 Investments U . S. Government securities..... 84,705 Other securities............................. 131,102 $399,011 $484,832 83,349 132,189 38,347 127,618 Total investments.............................. $215,807 Reserve balance with F. R. bank.. 42,690 Cash in vault........................................ 7,870 Deposits N et demand deposits.................... 330,628 T im e deposits.................................. 223,119 Government deposits..................... 2,484 $215,538 42,870 7,845 $165,965 43,828 8,040 336,209 228,046 6,859 362,736 235,142 406 T otal deposits......................................$556,231 $571,114 $598,284 Bills payable and rediscounts with Federal Reserve Bank................. 10,112 3,879 5,746 *In thousands (000 om itted). These banks are located in St. Louis, Louisville, Memphis, Little R ock, and Evansville, and their total resources comprise approximately 52.6 per cent of all member banks in this district. Debits to Individual Accounts — The following table gives the total debits charged by banks to checking accounts, savings accounts, certificates of deposit accounts and trust accounts of individuals, firms, corporations and U. S. Government in leading cities of the district. Charges to accounts of banks are not included. ♦Oct., 1931 East St. Louis & Natl. Stock Yards, 111..$ 28,942 El Dorado, Ark.... . 4,335 Evansville, In d ,... . 25,410 F ort Smith, Ark.... 10,435 Greenville, Miss... . 3,206 Helena, A rk.......... . 2,785 L ittle R ock, Ark. . 27,988 Louisville, K y ....... . 126,715 Memphis, T en n .... . 117,434 O w ensboro, K y ,,, . 4,630 Pine Bluff, Ark... . 8,418 Quincy, 111........... . 8,348 St. Louis, M o ....... . 557,697 Sedalia, M o ........... . 3,234 Springfield, Mo.... . 13,341 **Texarkana, A rk .-T e x ...... . 8,203 ♦Sept., 1931 *O ct., 1930 $ 27,319 4,003 21,099 9,127 2,372 1,747 24,086 128,334 85,358 4,140 5,149 7,321 531,121 3,281 12,006 $ 41,781 7,008 27,031 12,733 4,186 5,844 39,506 197,615 159,545 6,310 10,650 11,673 681,887 4,196 18,327 8,020 11,664 O ct., 1931 comp, to Sept. 1931 Oct. 1930 b 5.9% b 8.3 -20.4 -14.3 -35.2 -59.4 -16.2 - 1.3 + 3 7 .6 + 11.8 + 6 3 .5 + 14.0 + 5.0 - 1.4 + 11.1 — 30.7% — 38.1 — 6.0 — 18.0 — 23.4 — 52.3 — 29.2 — 35.9 — 26.4 — 26.6 — 21.0 — 28.5 — 18.2 — 22.9 — 27.2 + — 29.7 2.3 Totals......... .$951,121 $874,483 $1,239,956 + 8.8 — 23.3 *In thousands (000 om itted). ** Includes one bank in Texarkana, Texas not in Eighth District. Federal Reserve Operations — During October the Federal Reserve Bank of St. Louis discounted for 260 member banks against 215 in September and 208 in October, 1930. The discount rate remained unchanged at 3y2 per cent. Changes in the principal assets and liabilities of this institution appear in the following table: *N ov. 18, 1931 Bills discounted...................................................$25,471 Bills bought......................................................... 23,201 U . S. Securities................................................... 31,084 Federal Inter. Cr. Bk. Debentures.............. 630 Participation in Inv. Foreign Banks.....„..... 1,103 T otal bills and securities............................. $81,489 F. R. N otes in circulation............................. 85,890 T otal deposits....................................................... 73,117 Ratio of reserve to deposits and F. R. N ote Liabilities......................... 54.6% * In thousands (000 om itted). (Compiled November 25, 1931) *O ct. 18, 1931 $17,860 33,652 31,211 630 1,103 ♦Nov. 18, 1930 $21,370 5,809 14,151 1,093 $84,456 81,890 74,004 $42,423 79,786 76,079 51.2% 77.8% BUSINESS CONDITIONS IN THE UNITED STATES Production and employment in manufacturing indus tries declined further in October, while output of minerals increased more than is usual at this season. There was a considerable decrease in the demand for reserve bank credit after the middle of October, reflecting a reduction in mem ber bank reserve balances, and in November an inflow of gold largely from Japan. Conditions in the money market became somewhat easier. PRODUCTION AND EMPLOYMENT — Total out put of manufactures and minerals, as measured by the Board’s seasonally adjusted index of industrial production, declined from 76 per cent of the 1923-1925 average in Sep tember to 74 per cent in October. Output of steel remained unchanged at 28 per cent of capacity in October, although it usually shows an increase for that month; in the first half of November activity at steel mills increased somewhat. Automobile production declined sharply in October. Pro duction of shoes and woolens decreased and cotton mill ac tivity showed little change, although an increase is usual at this season. Output of bituminous coal increased seasonally, and there were large increases in the output of anthracite and petroleum. Volume of factory employment declined substantially from the middle of September to the middle of October. At woolen mills, where an increase in employ ment is usual at this season, there was a large decrease. In the automobile and shoe industries reductions in em ployment were considerably larger than usual, while in the canning industry the decline was wholly of a seasonal char acter. The silk goods and hosiery industries’ employment increased by more than the usual seasonal amount. PER CENT Federal Reserve B oard’s index of factory em ploym ent with adjustment for seasonal variation. (1923-1925 a v e r a g e s 100.) Latest figure O ctober, 70.3. and petroleum were also higher in the middle of November than in early October. During this period the prices of live stock and meats declined rapidly, reflecting in part develop ments of a seasonal character. BANK CREDIT — Reserve bank credit, which had in creased rapidly between the middle of September and the third week of October, declined by $265,000,000 during the following four weeks. This decline reflected a large reduc tion in member bank and other balances at the reserve banks and also an inflow of gold, chiefly from Japan. De mand for currency, which had been on a large scale during September and the first three weeks of October, showed re latively small fluctuations after that time, and in the second week of November declined by somewhat more than the seasonal amount. Loans and investments of member banks in leading cities continued to decline during recent weeks and on November 18, the total volume was $500,000,000 smaller PER CENT M onthly rates in the open market in N ew Y o r k : Commercial paper rate on 4 to 6 month paper. A cceptance rate on 90-day bankers’ accepttances. Latest figures are averages o f first three weeks in Novem ber. The November cotton crop estimate of the Department of Agriculture was 16,903,000 bales, 600,000 bales larger than the October estimate and 3,000,000 bales larger than last year, in spite of a reduction in acreage. Data on the value of building contracts awarded in the period between September 1 and November 15, as reported by the F. W. Dodge Corporation, showed a continuation of the downward movement; in this period value of contracts was 29 per cent smaller than in the corresponding period of 1930, reflecting smaller volume of construction and some what lower building costs. DISTRIBUTION — Total volume of freight-car load ings remained unchanged in October, while loadings of merchandise decreased. Department store sales increased by somewhat more than the usual seasonal amount. WHOLESALE PRICES—The general level of whole sale prices declined from 69.1 per cent of the 1926 average in September to 68.4 per cent in October, according to the Bureau of Labor Statistics. Prices of grains, cotton, and silver after showing a rapid rise beginning early in October, declined considerably, but in the third week of November were still above their October low points. Prices of hides in N ovem ber. than five weeks earlier. This decrease reflected substantial reductions in loans on securities and in other loans, as well as in the banks’ holdings of investments. At the same time, deposits of these banks also declined with a consequent reduction in the reserve balances which they were required to hold with the reserve banks. Money rates in the open market, which had advanced sharply during October declined somewhat early in Novem ber. Rates on prime commercial paper declined from a range of 4— -4% per cent to a range of 3$i—4 per cent, and rates on bankers’ acceptances, from 3% to 2 per cent.
